After careful analysis of the prospectus offered by Sygnus Credit Investments Ltd. I have these brief comments:
- Sygnus profits from July 2017 have been impressive at US$500K. Their expected year profit is US$1M.
- Sygnus was founded in June 2016
- Sygnus has a solid Board of Directors with diverse skill sets.
- The Company is seeking to raise only US$10M.
- The Company will issue up to 90,909,091 ordinary shares in two classes US$ and J$ at a fixed price of J$13.72 per J$ share and US$0.11 per US$ share.. However, one should be careful with the currency conversion factor with the Jamaican economy on the improve.
- Sygnus does not seem to have a large client base, however, the clients they have are large entities.
- Sygnus is not just about investment banking, investment management but also in Tax advisory services.
- Some $11M left the Company to unknown sources. It’s a pity not much information has been provided on that.
- Sygnus operations was registered in St. Lucia.
- Dividend policy is very impressive. They intend to distribute up to 85% of the SCI’s net income to stockholders in the form of quarterly cash dividends.
- They have a solid buy back policy allowing shareholders to offer for sale such number of shares with teh aggregate value of which shall not exceed more than 15% of the net asset value.
- Their earning per share is favorable.
- The expenses of the Company seems small at this point with no salaries paid out.
Based on my analysis a BUY would be the best bet here. If you are a day trader a quick out by listing could earn you up to a 40% ROE. If you are a long term trader then a hold for 2 years could see great dividends and a gradual increase in value while the sharks exit their position.
Tomorrow I will look at the prospectus of Everything Fresh which opens on Thursday in the Junior Stock Exchange.
Safe trading everyone and remember only risk what you can afford to lose. Trading stock is a high risk investment which can give high returns if done properly.